Company Overview

Legacy Education Alliance, Inc. (LEAI) is a leading provider of educational training seminars, conferences and services. LEAI was founded in 1993 to provide quality professional education enrichment in the areas of real estate investing, financial instruments, and personal finance with the goal of empowering its students with real-world, practical knowledge. The global company has more than 200 employees worldwide with students in more than 100 countries. 900,000+ people have participated in its Rich Dad Education Workshops and Seminars since 2006. Please check out: http://legacyeducationalliance.com

Value Proposition

LEAI is a leading education company that is poised for growth, driven by the introduction of new brands into the U.S. market, entry and expansion in overseas markets, and a growing suite of online courses. The Company’s business model is already proven, with rapid growth in revenues and profits. With its strong cash position and minimal debt, LEAI is well positioned to grow its service offerings. LEAI has recently gone public and only trades at a P/S (ttm) multiple of 0.06x. While not a direct comparison, other publicly-traded companies that operate in the education industry trade at a P/S (ttm) range of 0.3x-2.5x. We are valuing LEAI at a 30% discount to the low end P/E (ttm) of its peer group, or 7.2x. Applying this figure to our FY16E EPS estimate of $0.38 derives a target price of $2.75. This provides a significant potential opportunity for investors who invest before the stock becomes more widely known.

Investment Highlights

3Q15 revenue was $22.49 million, down marginally from 3Q14 revenue of $22.54 million

Cash sales in 3Q15 were $24.2 million, an increase of 17.0% as compared to $20.7 million in 3Q14; management believes cash sales are the best metric to determine its operating performance

Strong cash balance of $7.9 million with minimal debt

Flagship brand Rich Dad Education is based on the teaching of Robert Kiyosaki, an entrepreneur, investor, educator, and author of bestseller Rich Dad Poor Dad

Projecting strong growth internationally, particularly in SE Asia

Expanded international presence into 20 countries in 2014, up from four countries in 2013; revenue from foreign markets comprised 36.0% of revenue in 3Q15, up from 29.8% in 3Q14

Recently opened offices in Hong Kong and South Africa

Development of online courses expected to significantly grow LEAI

Worldwide e-learning revenue reached $35.6 billion in 2011 and is expected to grow to $51.5 billion by 2016 (7.6% CAGR)

Introduction of additional brands into the U.S. market (Independent Women, Women in Wealth, Brick Buy Brick), expected to grow and diversify U.S. revenue

Strategy already implemented and successful in the United Kingdom

Rich Dad brands accounted for 94% of U.S. revenue in 3Q15, as compared to 42% of U.K. revenue in 3Q15

Additional Information

Disclosure

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Legacy Education Alliance (LEAI) is a client of RedChip Companies,
Inc. LEAI agreed to pay RedChip Companies, Inc. a monthly cash fee for twelve (12) months of Investor awareness services and programs are designed to help small-cap companies communicate their investment characteristics. RedChip investor awareness services include the preparation of a research profile(s), multimedia marketing, and other awareness services. For the full disclosure, please visit: http://www.redchip.com/company/home/LEAI

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